The Government is to push the button on the sale of £12bn of student loans as it seeks to sell off further public assets to reduce the deficit.

Mark Russell, chief executive of the Shareholder Executive, which manages a string of taxpayers’ assets, said that the landmark sale would take place this year.

He also disclosed that the sale of up to £3bn of illiquid assets from the Royal Mail pension fund is now under way, and that the sale of the Government’s stake in Urenco, which could net £3bn, is on track.

In total, the three assets could bring in as much as £18bn into Treasury coffers.

In an interview with The Telegraph, Mr Russell confirmed that the student loan book sale would begin in 2014. “There are clearly challenges but we think we are confident that we will be able to start a process this year,” he said.

“Our market testing [conducted by Barclays and Rothschild] has shown that as a new asset class we think there’s going to be some considerable demand for it.”

The sale would be the first from the pre-2012 Income Contingent Repayment (ICR) student loan book. Mr Russell said that the research had earmarked some £12bn of a possible £40bn which could be sold.

The two investment banks which undertook the market testing have been appointed to lead the sale, which will be done in a series of tranches.

“We’ve got a number of years to do it. Obviously we can’t just go and place £12bn of student loans at once – it will have to be in tranches,” confirmed Mr Russell. The tranche sale will be the first of its kind – and different from the sale of the Government’s much smaller “mortgage-style” loan book which began in March last year.

In the Shareholder Executive’s annual report, published in November, the asset-management body confirmed it was “looking for the best way to reduce public sector net debt and the Government’s risk exposure, whilst delivering value for money for taxpayers and ensuring that borrowers are not disadvantaged as a result.”

Mr Russell also revealed that the Shareholder Executive has begun the sale of £2.5 to £3bn of illiquid assets flowing from the Royal Mail pension fund. Some £25bn of assets were transferred on to the Treasury’s books, of which £15bn were sellable assets.

The liquid assets were sold within a month of the 2012 transfer. “As with any pension fund, there’s a bunch of illiquid assets – comprising property, unquoted private equity assets, and some distressed debt – in total, that’s about £2.5 to £3bn,” Mr Russell said.

“That’s the other sort of sale exercise which is ongoing.” Jones Lang LaSalle has been appointed to advise on the sale of the property assets, with no independent advisers appointed to work on the private equity or high-yield assets.

Mr Russell said that the sales process for Urenco, which is co-owned by the Dutch and German governments and is worth as much as £10bn, is “in a reasonable place”.

During the interview, Mr Russell defended the Shareholder Executive’s handling of the Royal Mail IPO process, saying: “Our overall objective was not just to get the last cent on the first sale.

It was always to ensure that we can sell our remaining stake, and, crucially, that we leave the company in a position that it can access the capital markets.

“So, when it came to pricing, what I say is that we didn’t conservatively price this, but we didn’t aggressively price it,” he continued.